When PayPal revealed that its millions of customers could buy and sell Bitcoin last year, it caused quite a stir in the crypto markets. The move, coupled with the company’s recent move to add Bitcoin purchase to its Venmo service, has been hailed as a significant step toward the mainstreaming of cryptocurrency. But the services have also drawn criticism. Skeptics argued that this was not genuine Bitcoin since PayPal customers could only buy and sell it, not transfer it to others.
PayPal’s approval of cryptocurrency
PayPal now looks to be preparing to remedy the problem. Speaking at Consensus on Wednesday afternoon, PayPal’s head of blockchain and crypto, Jose Fernandez da Ponte, said that the firm would introduce support for third-party wallet transfers. The approval means that PayPal and Venmo users will send Bitcoin not just to other users on those platforms but also to services like Coinbase and external crypto wallets.
Fernandez da Ponte said they want to make it as open as possible and offer their customers options. For example, he noted that PayPal wants its clients to bring their crypto to use it in commerce and take the crypto they purchased to their desired destination.
According to Ponte, they recognize greater usefulness to those tokens if they can transfer around. He added that they are examining how they can enable users to move crypto to and from their PayPal accounts.
PayPal is also said to be working on a stablecoin. However, Ponte refused to disclose any specifics in the interview on Wednesday, although he did not dispute the notion.
Reliance of PayPal on blockchain
PayPal now depends on blockchain infrastructure provider Paxos to manage its Bitcoin operations, and it depends on several other partners to enable its worldwide financial operations. This implies that the firm may rely on Paxos or another crypto business to manage interfaces with third-party wallets. Still, it may potentially create the infrastructure itself with the assistance of Curv, a crypto-security startup it purchased earlier this year.
Dan Schulman view on cryptocurrency
PayPal CEO Dan Schulman has come to see cryptocurrency and blockchain as a critical component of the company’s operations in recent months. In a recent interview, Schulman told MycryptoParadise that he believes technologies have enormous potential to reduce the cost of money transfers, particularly in third-world countries, and to broaden access to financial services in general.